TaxBandits FREE Payroll
Automate the payroll process
with TaxBandits
What's included for FREE?
- Run Unlimited Payrolls
-
Accurate Payroll &
Tax Calculations - Secure Portal for Employee & Contractor
- Generate Pay Stubs Instantly
- Includes Bonus & Off-Cycle Payroll
Employer's Payroll Tax & Filing Requirements for the State of North Carolina (NC)
Handling payroll in North Carolina means understanding the state’s income tax withholding and unemployment insurance requirements. Whether your business is small or large, following the rules set by the North Carolina Department of Revenue (NCDOR) and the Employment Security Commission (ESC) is essential for accurate and compliant payroll processing.
Applicable North Carolina Taxes
In North Carolina, employers are responsible for a few key state and federal payroll taxes. This guide will walk you through each of these requirements in detail.
- State Income Tax (SIT): Withhold from employee wages based on the NC withholding tables.
- State Unemployment Insurance (SUI): Employers pay contributions to the NC Employment Security Commission.
- Federal Taxes: Withhold and remit federal income tax, Social Security, and Medicare (FICA).
- Federal Unemployment Tax (FUTA): Employers must pay federal unemployment contributions.
Understanding these obligations is essential for maintaining compliance and avoiding penalties.
Register for NC Income and unemployment tax on your own
North Carolina tax agency:
- North Carolina Department of Revenue (DOR) - Income tax withholding
- North Carolina Employment Security Commission - Unemployment tax
To report and pay state income tax withholding in North Carolina, employers must register with the NC Department of Revenue (DOR) and report unemployment taxes with the North Carolina Employment Security Commission.
Steps to Register with the North Carolina Department of Revenue (DOR)
Before you register, you’ll need to submit a business registration application online. Here is the information to register for this application:
- Social Security Number (SSN) or Federal Employer Identification Number
- North Carolina Secretary of State Number (SOS), if applicable
- Business name, address, phone number.
Register with the North Carolina (DOR)
- Step 1: Visit the North Carolina Department of Revenue Online.
- Step 2: Follow the steps and complete the prompts to register.
After successful registration, you will receive an Account ID and tax deposit schedule. You can use this number to pay and file taxes to NCDOR.
Steps to Register with the North Carolina Employment Security Commission
Register via Online:
- Step 1: Visit the NC Division of Employment Security Website.
- Step 2: Read the instructions and create an account.
- Step 3: Complete all the remaining prompts to register.
After successful registration, you will receive a six-digit Employer Account Number (EAN) and tax deposit schedule. You can use this number to pay and file taxes to SCDEW.
North Carolina New Hire Reporting
North Carolina (NC) employers are required to report all newly hired or rehired employees within 20 days of the start date. This helps to enforce child support orders and to maintain accurate employment records.
Who needs to report?
Any business, organization, or government entity operating in North Carolina that hires employees must report. This includes:
- Private businesses (corporations, LLCs, sole proprietors, partnerships)
- Federal, state, and local government agencies
- Nonprofit organizations
What information must be reported?
Employers of North Carolina must report the newly hired and rehired employees. Here is the information required to report newly hired employees to the North Carolina Department of Revenue:
Employer information:
- Federal Employer Identification Number (FEIN)
- Employer/Business Name
- Address
- Phone number
Employee/Independent Contractors:
- Social Security Number (SSN)
- Name of the contractor
- Address
- Date of hire
How to report new hires in North Carolina?
To report newly hired employees, follow the steps given below.
1. Online (Preferred)
- Step 1: Website: North Carolina New Hire Reporting Center.
- Step 2: Create an account or log in.
- Step 3: Enter the required employer and employee details.
- Step 4: Submit electronically — confirmation is provided immediately.
2. Mail
Download and complete the North Carolina New Hire Reporting Form from the state website.
Mail to:
North Carolina New Hire Directory
PO Box 427
Norwell, MA 02061
3. Fax
You can also fax to North Carolina New Hire Report Form using (866) 257-7005.
North Carolina State Payroll Tax Requirements
North Carolina employers must withhold state income tax from employee wages and pay Unemployment Insurance (UI) tax on the first $32,600 of each employee’s wages. This section outlines the key state tax requirements that every North Carolina employer must follow to ensure compliance.
State Income tax
Employers in North Carolina are required to withhold state income tax (SIT) from employees’ wages. As of 2025, employers must withhold a flat state income tax rate of 4.25% from employee wages.
State Unemployment Tax
State unemployment taxes are state-level payroll taxes that employers pay to fund unemployment benefits for eligible workers who lose their jobs through no fault of their own.
Who is liable?
North Carolina employers are liable for SUI taxes if they meet the following conditions:
- Paid $1500 in wages during a calendar quarter or;
- Had at least one North Carolina employee working for any part of the week, for 20 or more different weeks during a calendar year.
North Carolina State Unemployment Tax Rate
Employers in North Carolina must pay State Unemployment Insurance (SUI) taxes to support the state’s unemployment benefit program. The following table outlines the applicable SUI tax rates in North Carolina:
| North Carolina State Unemployment Tax Rate | |
|---|---|
| Taxable Wage Base | $31,400 |
| Tax Rate Range | 0.06 - 5.76% |
| New Employer Rate | 1% |
North Carolina Minimum Wage Requirements
North Carolina follows the same minimum wage as the federal minimum wage. Make sure all the employers meet the current federal minimum wage rate for all employees.
| Wage Type | North Carolina Rate (per hour) | Federal Rates (per hour) |
|---|---|---|
| Minimum wage | $7.25 | $7.25 |
| Tipped Minimum Wage | $2.13 | $2.13 |
| Actual Tip Credit | $5.12 | $5.12 |
Overtime Regulations
North Carolina follows the federal Fair Labor Standards Act (FLSA) for overtime rules, as the state has no separate overtime law. Non-exempt employees must be paid 1.5 times their regular rate of pay for any hours worked over 40 in a workweek.
Exemption:
Certain employees are exempt from overtime if they meet both the salary and duties tests under the FLSA. In North Carolina, this typically includes:
- Executive employees
- Administrative employees
- Professional employees
To qualify for exemption, these employees must earn at least $684 per week on a salaried basis and perform the specific job functions defined by the FLSA.
North Carolina Termination Reports
North Carolina does not require a routine termination report for employees who leave a company. Instead, Employers must maintain accurate separation records, including the employee’s last day, reason for leaving, and final wages.
North Carolina State Tax Payments
North Carolina State Withholding Payments
Employers must remit withheld State Income Tax (SIT) to the North Carolina Department of Revenue (NCDOR) based on their assigned filing frequency:
Quarterly filers – Payments are due by the last day of the month following the end of each calendar quarter:
| Quarter | Filing Deadline |
|---|---|
| Quarter 1 (January - March) | April 30 |
| Quarter 2 (April - June) | July 31 |
| Quarter 3 (July - September) | October 31 |
| Quarter 4 (October - December) | January 31 |
Methods to deposit North Carolina state income tax payments
Online (Recommended)
- Visit the North Carolina Department of Revenue to make tax payments securely for state withholding.
Methods to deposit North Carolina State unemployment tax withholding taxes
To deposit federal and state unemployment taxes, you can use various payment methods, which include:
1. Online (Recommended):
- Visit North Carolina Employment Security Commission to make SUI tax payments securely by credit/debit card.
2. Mail:
-
You can fill out the state unemployment tax form and mail it to:
NC Department of Commerce
Division of Employment Security
P.0. BOX 26504
RALEIGH, NC 27611-6504
North Carolina State Tax Filings
Quarterly State Income Tax Filings
Form NC-5 / NC-5P (Withholding Return): Employers use this form to report and remit state income tax withheld from employee wages. Filing frequency depends on your withholding amounts.
Quarterly or Monthly Filing:
-
File quarterly if total annual withholding is under $2,000 (due on the last day of the month after each quarter).
Deadline:
Quarter Filing Deadline Quarter 1 (January - March) April 30 Quarter 2 (April - June) July 31 Quarter 3 (July - September) October 31 Quarter 4 (October - December) January 31 - File monthly if withholding is $2,000–$15,000 (due by the 15th of the following month).
-
File semi-weekly if the annual withholding exceeds $15,000
Deadline:
- Wages paid Wednesday–Friday: Deposit by the following Wednesday
- Wages paid Saturday–Tuesday: Deposit by the following Friday
Annual State Income Tax Filings
Form NC-3 (Annual Withholding Reconciliation): Form NC-3 is used to reconcile the total state income tax withheld for all employees during the year with the payments made.
Deadline: This form is due by January 31 of the year following the end of the tax year.
Form NC-W2 (Wage and Tax Statement): Employers file Form NC-W2 to report annual wages and NC state income tax withheld for each employee.
Deadline: This form is due by January 31 of the year following the end of the tax year.
Quarterly State Unemployment Filings
Form NCUI 101 (Employer’s Quarterly Tax and Wage Report): Employers use Form NCUI 101 to report employee wages subject to unemployment insurance (SUI) and calculate quarterly SUI contributions.
Deadline:
| Quarter | Filing Deadline |
|---|---|
| Quarter 1 (January - March) | April 30 |
| Quarter 2 (April - June) | July 31 |
| Quarter 3 (July - September) | October 31 |
| Quarter 4 (October - December) | January 31 |
Run payroll for free with TaxBandits.
Say goodbye to manual calculations. With TaxBandits, process payroll in minutes and get free pay stubs with accurate Federal and State tax calculations.
Success Starts with TaxBandits
The Smart Business Owners Choice